Indonesia's JFX eyes carbon trading futures

JAKARTA Nov 10 (Reuters) - The Jakarta Futures Exchange is
studying the possibility of setting up its own carbon trading
futures which would be a key move to develop the country's
carbon trading market, an exchange executive said on Wednesday.

There is no carbon trading market in Indonesia now,
although there are several projects to earn carbon offsets
under the U.N.'s Clean Development Mechanism (CDM) scheme.

Players now sell carbon credits they earn to European
markets.

"We are studying some new products which will be traded at
the JFX. One of the products that we think has the potential is
carbon trading," Roy Sembel, JFX's director, told Reuters.

"We see potential players for such futures including PLN's
coal-fired power plants and from several renewable energy
projects that can earn credits under CDM," Sembel said,
referring to state utility firm PT Perusahaan Listrik Negara.

It is unclear if the exchange would simply serve as a hub
for trading of Indonesian CERs in a secondary market,
encouraging local investment banks to benefit from that trade
with developed countries, or whether it would signal a shift to
local carbon caps and sale of carbon offsets to Indonesian
polluters.

Under the CDM, investors in rich nations can invest in
clean-energy projects in developing nations and earn carbon
credits which they can sell for a profit or use to meet
mandatory emissions targets.

Sembel did not give details on the planned carbon trading
futures as it is still in very early stages.

Indonesia is seen as a key player in the fight against
climate change given it still has huge swathes of carbon
absorbing tropical forests.
(Reporting by Fitri Wulandari; Editing by Clarence Fernandez)